Sovcomflot to be privatized

The privatization of 25% – 1 share of Russia’s Sovcomflot (SCF) will be realized through public offering at Moscow stock exchange, said yesterday Economic Development Minister Maxim Oreshkin. TASS news agency also quotes his comment that a simultaneous listing at the New York Stock Exchange (NYSE) is not planned.

SCF is Russia’s largest shipping company focusing on transportation of oil, oil products and LNG. It is 100% owned by the state and its privatization is scheduled for March-April, 2017. The government expects to secure about RUR 30 bln (USD 520 mln or EUR 490 mln) from selling 25% – 1 share.

The Russian government has been planning Sovcomflot’s IPO for several years, but every time it was postponed due to unfavourable market conditions. Thus, the last attempt was in 2015, when the IPO was expected to gain RUR 24 bln. The company’s fleet includes 145 vessels with a combined deadweight of 13,033,147 tonnes and the average age of 8 years. The most part of the fleet is tankers (124), gas fleet comprises 9 LNG and 4 LPG carriers. As the company specializes in hydrocarbon transportation from regions with challenging icy conditions, a third of these vessels have a high ice class. The company services large-scale projects of offshore exploration and oil and gas production, such as Sakhalin-1, Sakhalin-2, Prirazlomnoye, Novoportovskoye, Varandey, Tangguh.

Sovcomflot is one of the largest ordering customers of Russian shipbuilding.